Industry View: Who’s on First? The Car Wash?
Everywhere I turn, I see articles about how consumers are changing. Today’s consumer demands higher-quality, more creative products from an increasingly upscale environment at an ever-decreasing price—and much faster than before.
Open a marketing textbook from as far back as the 1940s and look up “unique selling proposition,” or USP. A business must make a proposition that the competition either cannot, or does not offer. Coincidentally, the first 7-Eleven-branded store opened in 1946. So now, after 70 years of innovations in a never-ending battle to create a USP, in most markets consumers have been trained to demand a better value and seek better offers from competitors.
So where does that leave the owner/operator facing tightening margins on both gas and c-store sales? Further differentiation, of course! But differentiating yourself with a new packaged-good offering provides only short-lived relief because not all promotions will succeed, and competitors can copy and improve upon those that do. Distinguishing yourself with fresh or personalized foodservice can create a unique, lasting position in the market, but the added management complexity, labor cost and liability doesn’t fit every owner’s investment strategy.
Face it: Many entered the petroleum industry specifically seeking a real-estate-based investment that leveraged automation to provide a predictable return with minimal labor. Sure, many gas stations have evolved to sell packaged foods and ultimately became c-stores that sell gas. Many of those will become a food retailer first that also sells gas. But if you’re among the readers who cringe at the idea of retailing anything with a shelf life shorter than a candy bar, there’s another direction: becoming a professional car wash first that also sells gas.
After visiting hundreds of c-stores around the country, I often find myself thinking of the old Abbott & Costello routine “Who’s on First.” All sites have some combination of gas, c-store and car washing. Some do a stellar job with all three. Most, however, have a “first.” They’re a gas station, c-store, or car wash first that offers other services. You can see it in their signage. You can feel which profit centers are neglected by their appearance. But for those on prime real estate, struggling to make it work with their c-store, gas and outdated in-bay rollover car wash, doing nothing isn’t an option.
But reinventing the c-store isn’t the only option. In an increasingly common conversion, the rollover car wash is replaced by an express mini tunnel that fits in the same 35-foot bay but turns out 50 cars per hour. Wash packages include conditioners, tire dressing, glass protectant and high-end custom branded wax service. Customers drive through the wash past a video greeter, then exit to use free vacuums. Basic washes start at $3 to $5, with top packages capturing $15 or more, creating as much as $650 per hour. Customers can subscribe to unlimited monthly wash passes that use RFID windshield tags to control and document access.
And now I would normally list site characteristics such as traffic counts, demographics and property conditions needed to make such a conversion work, but I won’t. Do they matter? Absolutely. Will they guarantee success? Absolutely not. I’ve seen less-than- perfect locations hit it out of the park with such a retrofit conversion. I’ve also seen projects flounder even though they looked perfect on paper. Rather than detail the signage, branding and other marketing considerations that make a mini express tunnel car wash successful, I’ll sum it up: If you drive by or stop at a successful mini tunnel express wash at a gas station and ask the owner or dedicated car-wash manager the question “Who’s on first?,” expect to hear all about how the car wash works to maximize revenue during peaks while capturing and retaining customers for their “other” profit centers.
Within seconds of sending this article to some younger colleagues to review, I received replies saying nobody would know who Abbott & Costello were. One, however, took the effort to watch the old video online and wrote, “That has to be one of the most confusing things I’ve ever seen.” To which I replied, “Now imagine how confused customers are when a business doesn’t know who’s on first.”